Judge: Hollywood business destroyed by police standoff won’t get compensation

(The Center Square) – A federal judge ruled a Hollywood business owner whose shop was destroyed in a police standoff with a fugitive is not entitled to compensation from police.

The judge ruled NoHo Printing and Graphics owner Carlos Pena, whose insurance denied a damage claim, could not seek compensation under the Fifth Amendment’s takings clause, which protects against government taking of assets without just compensation, because, as Pena conceded, the police actions were “reasonable.”

“I’ve tried to do everything the right way this whole time,” said Pena in a statement. “I don’t even blame the police for what happened – they were trying to get a dangerous criminal off the streets. But that doesn’t mean I shouldn’t be paid after the business I worked so hard to build was completely destroyed.”

On August 3, 2022, an armed fugitive fleeing from the U.S. Marshals ran into the shop after attacking Pena, causing a standoff with the U.S. Marshals until the Los Angeles Police Department dispatched a SWAT team to capture the fugitive. In the ensuing 13 hours of action at the business, from which the fugitive escaped after 25 rounds of tear gas and pepper spray were deployed, over $60,000 in damage was done to the 31-year-old business’s equipment and building. Pena has since been operating his business out of his garage with donated, second-hand equipment, but has lost 80% of his income.

Pena’s insurance company denied his claim, saying government damage was not covered under his policy. Pena then sought damages from the U.S. Marshals, who told him they were not responsible for any of the damage and that he should instead take up his claim with the City of Los Angeles. In June 2023, Pena sent a letter with his claim to the city, which did not respond, leading him to file a lawsuit the following month.

Pena said he does “not fault the City’s police officers for acting in the public’s interest” — a statement the court used in its ruling supporting the police action as reasonable and thus not subject to the takings clause.

“Accordingly, because the damage to Plaintiff’s shop was caused by the LAPD SWAT team’s use of police power that Plaintiff concedes was reasonable, it did not constitute a taking for purposes of the Fifth Amendment,” wrote U.S. District Court Judge John F. Walter. “As a result, the Court must necessarily conclude that Plaintiff is not entitled to summary judgment on the issue of liability on his sole claim for the taking of private property without just compensation in violation of the Takings Clause of the Fifth Amendment.”

Pena and his lawyers from the Institute of Justice are appealing Walter’s decision at the 9th Circuit Court of Appeals.

“The government shouldn’t be able to continue hiding behind ‘police powers’ whenever it doesn’t want to compensate someone for destroying their property,” said IJ Attorney Suranjan Sen in a statement. “If the government breaks it, the government should have to buy it.”